The Oil & Gas Supply Chain: Oil Tank Storage and Movement Best Practices

Tank farm automation for oil movement and storage in refinery off-sites spans multiple technologies.  These include level, temperature, and flow measurements; distributed control systems (DCS); programmable logic controllers (PLCs); preset controllers; advanced control and optimization; safety systems, supply chain systems; and transactional business information systems. Since refinery off-sites are often key for monetizing production, oil tank storage and movement best practices are needed to enable these different technologies to work together as an integrated whole to support overall operational flexibility.

oil tank storage and movement best practices

The often-massive storage tanks and extensive auxiliary equipment and instrumentation represent expensive assets.  These allow for surges in volume to support the transition of batch crude oil receipts into batch finished product shipments while the refinery operates continuously.

Receiving/distribution terminals are associated with refinery off-sites that receive gasoline and distillates from refineries via pipelines, rail cars, barges, and/or marine carriers. Such terminals may blend ethanol or butane, into raw gasoline from the refinery and typically have truck loading operations to distribute the petroleum products to gas stations and fuel oil companies.

Operational Flexibility Is Key

A key goal of tank farm automation in refinery off-sites is to support overall operational flexibility. This enables safe operation within operational constraints. The ability to accommodate a low-cost crude purchase or deliver a finished, on-spec product when needed provides financial benefits for both refinery operations and supply chain management.

Operational flexibility allows the refinery to run with fewer changes to the refinery unit operations. Alternatively, it allows receipts and shipments to continue with minimal disruption when refinery unit operations are upset, such as an unexpected shutdown of a process unit like a hydrocracker.

The refinery runs continuously to process crude into rundown or blend component tanks. The rundown tanks in the tank farm provide surge capacity to meet batch blending and batch product shipments. Operational flexibility is improved if the refinery has many tanks with a large volume to maximize surge capacity.  Given that refineries and terminals have a specific number and configuration of tanks, the problem to be solved is how to use those tanks most effectively.  Operational flexibility provides oil traders with more options to buy the right crude oil at the right prices and to sell specific products to meet constantly changing customer requests.

Oil Movements Are Complex

Of course, tank farms must also be safe and environmentally compliant.  It is important to plan feasible movements, line up the piping, and execute the movement without delay or risk of product contamination.  With best practices, the topology of the piping system is precisely known and understood by the tank farm automation system. The status of the piping system, block valves, control valves, and all pumps must be known. Supply chain planning must consider any leaking valves or defective pumps, as well as other simultaneous material movements that could conflict with the lineup path of other movements.

The management of piping flow paths involves booking or reserving pumps, valves, and piping segments for the duration of a movement. Planning a series of product movements can result in many feasible solutions with many simultaneous movement paths. The particular pumps, flowmeters, valves, and pipe segments selected will place limits on the flowrates for feasible paths.  This can be a critical decision that impacts the duration of a movement.  A blending operation, for example, involves lining up multiple rundown tanks to a blend header that flows into a product storage tank.  Selecting a small pump or a small flowmeter for the alkylate blending component might limit the blend rate and extend the time required to fill the product tank. This could impact future oil movements by tying up the needed equipment. This is but one of the many complex situations that can arise for oil movement and storage. Many technology solutions are available for these types of problems. These include the following.

Tank Gauging Systems

Clearly, knowing the inventory in a refinery tank farm in real time is a fundamental requirement for effective automation. There are various technologies for level measurement and many will include “strapping tables” used to convert tank level to stored volume using a look up table. Tanks expand and distort when filled. Temperature compensation is often also needed to ensure accurate volumetric measurements.

Available tank gauging options include:

  • Radar/microwave
  • Hydrostatic, D/P head-based level
  • Capacitance
  • Ultrasonic
  • Buoyancy float (servo or tape)
  • Float Inductive
  • Nuclear
  • Dip tube with gas flow back pressure
  • Level switches (D/P, capacitance, float…)

ARC has developed a selection guide that can help users select the appropriate tank gauging systems for their varied applications.

Tank Information Systems

Tank information systems (TIS) combine tank level/volume information with product quality information that might be computed, measured with analyzers, or determined by periodic sampling with lab analysis.  The TIS could include a graphical user interface and likely provides connectivity to other automation functions.  The TIS provides a useful real-time database to support other tank farm applications.

Movement Monitoring and Yield Tracking Applications

Movement monitoring and material balance yield tracking applications can display all the active movements with alarms for issues and keep records for all movement histories.  Mass balance checks can help ensure that reduced volumes in the source tanks match both flow metering and the volume gain at the destination tank.  Flowrate metering can be adjusted using accepted practices to compensate to standard conditions.  Movements can be tracked against customer orders.

Path Management/Movement Automation

Path management typically employs procedural automation to facilitate movement line ups, start the flow, and stop the movement when completed (or if it must be interrupted).  The application may involve booking specific equipment and requires a complete understanding of the entire tank farm piping network. Without instrumented pumps, valves, hoses, and other assets, path management cannot be automated, requiring confirmation that manual procedures are accomplished. For example, some hose connections may be required to start an oil movement, but the operator must first confirm that the proper hose connections are made.

Blend Ratio Control

Refinery tank farms routinely have gasoline and distillate blending systems.  At a minimum, a refinery will execute a simple ratio control scheme in which selected components are combined into a blend header before being delivered to a product storage tank or sent to a pipeline.  During this blend movement, the blend components are maintained in a volumetric ratio based on flow measurements. In a typical arrangement, the flows ramp up to a blend rate, continue at the blend rate until the blend approaches the end, then flows ramp down to a trickle before the blend stops.  Various schemes can handle a situation in which one or more components cannot keep up the required flow, which would prevent the desired blend ratio from being achieved.  For example, “pacing” control could be used to slow down the blend rate to maintain the desired blend ratio.

Blend Optimization

Simple blend ratio control does not respond to upsets in product quality or errors in estimating the component tank qualities used to compute the blending ratios.  Various implementations use online analyzers at the blend header for feedback control to adjust the blend ratio during the blending process.  This helps ensure the blended product meets all product quality specifications.  Some configurations compute the values of some or all blend properties in the product tank as it is filling, based on analyzers connected to the blend header.  With optimization, the blend can be optimized for the lowest cost of components, or an alternate goal like minimum deviation from starting ratio.

In either case, the analyzer-based control system attempts to fill a product tank that will meet product specs.  An off-spec product tank is problematic as it may require splitting the tank into two volumes with a patch (reblend) for each. At best, it ties up tankage and delays shippable product. The blend optimization problem typically extends into the refinery operation to keep a proper inventory of blend components and ensure the refinery itself is operated at optimal targets within all operational constraints. Producing the most profitable blended products when needed has significant impact on supply chain management and refinery profitability.

Since blending can involve a collection of online analyzers, these analyzers must be managed to ensure they deliver reliable and accurate results. This requires periodic calibration and validation of streaming real-time data.

Oil Tank Storage and Movement Best Practices

A top-performing oil movement system requires many different functions to work together smoothly.  Compared to typical refinery units, tank farm automation touches more business organizations and requires frequent coordination between the operations group, supply chain and trading group, and refinery scheduling and planning groups.

ARC recommends that installing high-quality (ideally, intelligent) field instrumentation, especially tank gauging, is a good starting point. Since product quality of crude oil impacts refinery operation and finished product quality must meet shipment specifications; high-quality, well-calibrated online and laboratory analyzers are also essential.

It is important to clearly identify roles and responsibilities that are consistent with the software integration of business and operational applications.  As an example, the planning group may queue up a sequence of gasoline blends for the next 30 days.  Operations may execute a planned blend, but might be forced to deviate from the recipe due to unforeseen refinery upsets.  This, in turn, may require the blend planner to edit future blends in the queue.

Clearly, it’s critical for all personnel to be working from accurate and timely data with a single version of the truth.

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